Japan setting up

November 18, 20132 Comments

A ascending triangle appears to be setting up on the daily chart of the iShares Japanese index chart. Signs are looking positive for a breakout past the top of the triangle. The 200 day and 50 day MA’s are sloping up, and the market broke through the 50 day recently. Momentum indicators are hooking up, including the longer termed MACD indicator. Comparative relative strength (CRS) vs. the U.S. market (second pane from the bottom of the chart) is still questionable, but there may be signs of a turnaround happening on this indicator. Note the recent attempt to move above its negative trendline.

INJ

I wouldn’t consider entering this trade with fresh money until the triangle breakout occurs with conviction, in this case through $10.20 on the INJ chart. You’ll also want to see the CRS line pick up a bit more. But the signs are there – should we see a strong move on this market inspiring a triangle breakout, I’d be looking at Japan as a place to invest some capital.

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2 Comments

  • Thats an ascending triangle, isn’t it? I will keep an eye on it, but Japan has burned my butt the last 20 years or so…

    Reply
    • Hey Geoff–gah! Meant to say ascending, but I must have been daydreaming when I typed that–thanks for catching it. Consider it changed–thanks for the heads-up.
      BTW–just because something burned you in the past, doesn’t mean it cant be traded properly. Eg–Just as many people traded APPL for a profit to $700/sh –as bought it at $700 to lose their shirts. No stock or stock market owes anyone anything, or is permanently a bull or bear candidate–they are all just vehicles to trade according to the trend.

      Reply

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